As most people have heard in the news the era, we are currently experiencing in the workforce has been deemed the “Great Reshuffle.” Grey Search & Strategy and many other executive search firms are now experiencing the “Great Counteroffer.” The number of counteroffers has increased over the last year as employers are throwing everything they can (money, incentives, titles, etc.) at employees to keep them with the company. This in turn creates a situation where the employee/candidate must decide between taking the new opportunity they originally were seeking, or staying with the company they weren’t completely satisfied with.
Emotions Behind the Decision
Both employer and employees will experience many emotions when making a decision that has a significant impact on their life. Here are seven common emotions of change and how they coincide with making a career change or accepting a counteroffer:
Seven common emotions to change:
1. Fear: changing roles can be scary. The uncertainty of the new role working out or being what you’re really looking for can cause this emotion. The fear of failure at a new company can play a large part in making the decision.
2. Grief: Employees can feel like they are letting down their teams/managers; leaving behind a favorite co-worker, manager, etc. This can bring on the emotion for both employers and employees.
3. Enthusiasm: Your enthusiasm for the potential of a new role may leave others frustrated which can lead into the next two emotions.
4. Anger: This can come from managers or co-workers for leaving them; This could also help make you realize someone’s true colors!
5. Confusion: This emotion can come from employer or employee. Confusion for employees come when considering if this is the right decision or the clouded judgement that can come when an employer offers a counteroffer. Employers may be confused on why the employee is looking for a new role or how they will try to fill the role if the employee leaves.
6. Loneliness: Employees can feel this emotion because they are transitioning out of having relationships built with their old team and moving to a new team where they don’t know people as well as they did before.
7. Sadness: This is also tied to loneliness but feeling of sadness can determine a decision of accepting or not due to leaving team members you may have built strong relationships with or even managers.
Percentages of People Getting What They’re Told
• 80% of candidates who accept a counteroffer from their current employer end up leaving within 6 months.
• 9 out of 10 candidates who accept a counteroffer leave their current employer within the twelve-month mark.
• 50% of candidates that resign will be counter offered by their current employer.
• It can cost the current employer as much as 213% of annual salary to replace a senior executive.
• 50% of candidates that accept counter offers from their current employer are active again within 60 days.
• 57% of employees accept counter offers made to them.
Candidates: Don’t lose sight of why you’re looking or considering a new offer.
Does an increase in salary or a bonus fix the issues with your current role? Does a title change allow you to feel more challenged or change the relationship you have with your manager? Do these added incentives change the company culture that you don’t align with? These questions are backed up by the statistics above. In the end all these bright, shiny “rewards” or “incentives” given by your current employer are really just band-aids.
Employers don’t want to lose employees because it leaves them needing to backfill the position, costing them time and money. As a candidate looking for a new opportunity, remember: There was a reason you were looking. It’s to continue to grow your career, find a company culture that aligns with your values, or to get recognition for the job you’re doing. The money increases and job titles probably didn’t come until the employer found out you’re leaving. It’s important to not lose sight of why you were looking in the first place!
Tips Around Counteroffers
Below are tips for employers and employees on how to navigate a counteroffer situation. It allows a guideline for both parties to feel they have done their due diligence in making the right decision of accepting a counteroffer or presenting one.
Tips for Employers:
- Understand why an employee is looking for a new opportunity. Communication is key! Talk to your employees to see what they need to stay engaged, what their intrinsic motivation for looking elsewhere might be, then develop a plan.
- Make sure the company’s vision is not only talked about but acted on. Company culture is very important for employees and why they choose to stay with a company. Does your company live by the values on the wall or just talk about them?
- Challenge your employees in their roles by taking on special projects or creating a development plan to take on more responsibility. Giving employees opportunities to contribute through added responsibilities or leading certain projects can improve engagement. Sitting down with employees more than just your yearly review time to see how their growth goals are coming along or building out new ones.
- Do you need to look at the compensation structure to make sure you are offering competitive wages? Grey Search + Strategy works with our clients and one of our partners to gather a compensation analysis. This allows us to present the data to our clients to make an informed decision on determining compensation that is competitive in the market.
- Does the leadership need training or development to keep their teams engaged? As a company, is there enough tools and resources for the leadership team to develop so they can make sure their teams are engaged and committed are just as crucial. Having a bad manager or boss can be a key contributor to why employees are looking for new opportunities. Be sure to make sure you have the right people in place to lead the company to its goals.
Tips for Employees:
- Have a conversation with your manager before exploring the market. (Talk to them about potential internal opportunities, extra training, pay raise or more flexibility.)
- Make sure you have a clear idea of why you’re looking for a new opportunity (motivations behind moving: money, added responsibility, change of culture, etc.)
- If a counteroffer is given, look at the offer and ask if these items will be followed through on? Does this satisfy the things that lead to you looking externally? How does this change the dynamics of your relationship with the company and/or manager?
We have implemented this information into the conversations we have with both our candidates and clients. Because we experience this “Great Counteroffer” firsthand with both parties involved in finding talent, it’s important for us to educate both employer and employee so they can feel confident about their decision. Employees should remember why you were looking for a new opportunity in the first place. Employers shouldn’t wait until you are about to lose an employee to show them recognition or pay them their worth. For both parties it is important to have an open line of communication on goals and expectations with a structured plan on how these things can be achievable!